Development Impact Bonds in Financing Flood Risk Management

Marcin Wiśniewski and Krzysztof ŠYskawa

Scientific Annals of Economics and Business (continues Analele Stiintifice), 2020, vol. 67, issue 4, 437 - 452

Abstract: In this paper, the authors propose a new innovative solution to financing flood prevention and financing its consequences using the development impact bonds model. Firstly, the necessity of financing the flood problem is to be described as a public task, including the presentation of previous methods and solutions. Secondly, the authors derive a new model for financing flood problems basing on development impact bonds. This kind of financing comes from the New Public Management idea called “payments-by-results†. The new model shows that there is a possibility to construct a financial mechanism, which allows financing anti-flood interventions, such as relocation of residents from flood-threatened areas, using private financial resources, and giving the government the guarantee to pay only for the success of the intervention, which means a guarantee of effective public spending. At the end of the paper a SWOT analysis into this solution is presented. JEL Codes - G22; G23; H40; H54; H70; H84; Q54

Keywords: flood risk; social impact bonds; development impact bonds; insurance companies; relocation (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:aic:saebjn:v:67:y:2020:i:4:p:437-452:n:176

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